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Wednesday, April 14, 2010

This is one of those ideas that you would never believe people spent money on unless you saw it firsthand:

The first time I saw this thing I thought it was something that some guy made by himself in his garage just for fun. But once I started seeing more of them I came to the ridiculous conclusion that someone was mass producing them, followed by the even more ridiculous and horrifying corollary that lots of people were buying them.

Well and good. If people want to stick a cheap plastic face on their trees, they are free to do so.

Yes, they are free to do so, but how much do you think these cost to produce? Maybe $2 max? And at that cost, you would expect to see them for sale for about $5, maybe $5.99, or, if it is a high demand area in a woods, maybe as much as $9.99 right? I mean, seriously, who would pay more than $9.99 for a cheap tree face? Frankly I wouldn't hang one of these in my yard if you paid me $9.99, but I would probably agree to accept it and keep in in a box somewhere for that price.

In any case, you would be wrong. They cost $27.95, and they come in at least a dozen different "styles." The one above is "named" "Whistlin' Pete."

Ok, fine, so they are way overpriced, but surely they are being sold at some kind of little specialty shop on the internet right? And only a few people worldwide are interested in them? Right?
No. They are available at Home Depot, at about 2,500 locations all over North America, selling for $27.95 each, which, by my estimates, is a profit margin of 1297%.

The fact that this company has succeeded should give all small entrepreneurs hope. In fact, all you have to do is make a bunch of these tree faces and sell them for one dollar less. There is no way these things cost more than $2 to make, so you can keep cutting the price a long way down and still be profitable.

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